Journalize the following entries for the seller and the buyer: (a) Seller sold merchandise on account...

Journalize the following entries for the seller and the buyer:

(a) Seller sold merchandise on account to the buyer, $4,750, terms 2/10, net 30, FOB destination on December 21. The cost of the merchandise is $2,850. The seller pays the freight of $75.

(b) Buyer pays within the discount period on December 31.

Solutions

Expert Solution

	Seller				Buyer
		Debit	Credit			Debit	Credit
(a)	Accounts receivable	$4,750	-	(a)	Merchandise inventory	$4,750	-
	Sales	-	$4,750		Accounts payable	-	$4,750

	Freight out	$75	-
	Cash	-	$75

	Cost of goods sold	$2,850	-
	Merchandise Inventory	-	$2,850

	Seller				Buyer
		Debit	Credit			Debit	Credit
(b)	Cash	$4,655	-	(b)	Accounts payable	$4,750	-
	Sales discount ($4,750 X 2%)	$95	-		Cash	-	$4,655
	Accounts receivable	-	$4,750		Merchandise inventory	-	$95

ekkarill92 answered 1 year ago

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